The present invention relates broadly to methods for property transactions and, more particularly, to a method for creating and managing a lease agreement wherein a third party provides lease management and payment guaranties.
Traditionally, leases of property, for example leases for houses or apartments, involve a lessor and a lessee and, more particularly, a landlord and a tenant. In creating the lease relationship and lease agreement, the landlord will typically require background information from the prospective tenant to include various types of financial information, e.g. employment information and current income. Although recommended, a credit check through an authorized credit agency may not be conducted, depending on the landlord. This is especially true with property holdings often units or less. Typically, these landlords may have different professions and do not make their living from leasehold interests in their property. Such landlords may lack the time or expertise to fully monitor the financial condition of their rented property with precision and regularity.
In addition, personal dealings between the landlord and tenant may give rise to the opportunity for an unscrupulous tenant to take advantage of a landlord's good nature, resulting in consistently delayed rent payments or, in extreme cases, the total absence of rent payments.
Some landlords turn to property management companies, yet these companies can be expensive and there are no assurances that rent will be paid to the landlord when it is due. These property management companies may lack the resources and expertise to provide assurances that landlord will receive timely and complete rent payments. Perhaps more importantly, the management companies are under no obligation to assure landlords that they will receive the rent due.
Accordingly, there exists a need for a leasehold arrangement and method for managing the leasehold arrangement that will provide the landlord with assurances that the rent will be received in a timely manner.